Will Tony Abbott really get rid of the carbon tax?

Tony Abbott has left no doubt about his intention to scrap the carbon tax should he become prime minister.

But it is not going to be easy, and there's every chance carbon pricing will stay in place, writes David Forman.

The issue of carbon pricing has one more electoral cycle to run, but it will be dead either by December 2013 or late 2015, depending on the result of this year's election.

Either way, few politicians will lament its disappearance from the political front line.

A return of the Government is not impossible, but with Labor needing to gain seats to achieve this, it is hard to see at this stage. Should the Coalition win, carbon pricing policy will be the first test of whether Tony Abbott chooses to model himself as a great political pragmatist, like his hero John Howard, or a crash-or-crash-through leader.

Abbott has left no doubt about his commitment to abolish the tax. But getting there will be a painful and scary path which might force him to question whether compromise is not only safer but also a better outcome for a reforming conservative in the long term.

His first problem is that despite the rhetoric of the past two and half years, the election will not be a referendum on carbon pricing.

Tony Abbott's attack on the carbon tax has been focused, unrelenting and effective, but the dividend it has delivered has shifted. The swing back toward the Government supports the idea that the anger with the carbon tax has faded, as the Prime Minister insisted it would.

The lasting dividend the anti-carbon tax campaign has provided the Opposition is damage to the PM's personal credibility. This is the payoff the Opposition sought to double up on with its personal attacks on Gillard's past.

It is no coincidence that carbon pricing was barely mentioned as the spiteful 2012 parliamentary year reached its ugly nadir. Carbon was not the Opposition's best lever against the PM's credibility; her personal and professional past was.

Where does this place carbon post-election, and what political context will a Coalition government face in 2013-14?

Firstly, all decisions would be made in a very different frame to that of the present government, especially if Joe Hockey is treasurer.

For all the fuss about the politics of a budget surplus, there is bipartisan agreement - and market support, in theory if not in practice - for budget balance over the growth cycle.

When growth is at its present level of around 3 per cent, the deficit needs to be eliminated to deliver balance over the cycle. So, whoever wins the election will need to achieve a surplus in their first year of office while facing weak revenue as the resources boom subsides.

For Joe Hockey, this represents an opportunity to take a deeper look at government in the way UK prime minister David Cameron promoted his Big Society to make a virtue out of a fiscal crisis.

Hockey called for the end of the "age of entitlement" in a speech that deserved a lot more attention than it has received. Hockey contends governments can no longer afford the vanity of middle-class welfare.

But this is a vision of Government very different from what people have grown up with. Remaking expectations of government can only be bought at the cost of huge short-term political capital, as Cameron's experience shows.

It is also a vision potentially at odds with Tony Abbott's conservative political formula.

Abbott proudly declares himself a graduate of the John Howard school of political pragmatism, where governments keep an eye on electoral appeal and spend precious political capital on only a few big issues.

Is the repeal of the Carbon Tax in 2014 likely to meet the big issue criteria?

The Coalition has promised carbon pricing will be repealed in six months. This is predicated on a Labor opposition supporting such legislation, a likelihood environment spokesman Greg Hunt put at 80 per cent in speeches to business groups.

Actually, those chances are likely to be closer to zero. The Coalition promise serves a pragmatic purpose of getting them to the other side of the election because it provides an answer for when they are asked how the tax will be removed, but it will not be much value after that in the reality of a post-election Senate.

Consider what a prospective Coalition government will be facing in trying to abolish carbon pricing.

Firstly, the political dividend would be limited. The community appears no longer enraged by the tax itself, but all other parties in the Parliament are enraged by the prospect of removing it.

Supporters of carbon pricing, while inept, disunited and disorganised over the past five years, can surely be expected to be able to mount a competent campaign to have it retained.

Secondly, repealing the carbon tax comes at a cost to the budget - probably a very big cost if the present Government is to be believed - at a time when the incoming treasurer will be working desperately to get the budget in balance.

Thirdly, if the Treasurer framing the budgets at that time is Joe Hockey, he will come into office with an agenda of reforming government to correct the "chronic failure of the democratic process" represented by what he sees as citizens addiction to handouts from the public purse.

He will want to do some things that will be profoundly unpopular to wean people off the state teat. He will have to do that in his first two budgets, and it will hurt politically.

In this environment, an Abbott government would be moving to repeal the carbon pricing package and almost certainly have it rejected by a hostile Senate.

Tony Abbott has repeatedly said he will force the issue through a double dissolution if need be. It is easy to talk about double dissolution elections from the safety of opposition; it is rather a different prospect to bring one on from the government benches.

Any election is all about uncertainty. The received political wisdom since Bob Hawke had his nose bloodied in 1984 is that the electorate dislikes early polls.

Double dissolution elections are even scarier. Governments are left to live with a Senate make-up almost impossible to predict, and for six years or more the balance of power can be in the hands of a collection of odd bods thrust into positions of power and influence. (Though a Coalition government might see some upside in shaking up the Senate in the hope the Greens lose the balance of power.)

On top of that, the move from a carbon tax to the more widely supported cap and trade model will be less than a year away by the time the opportunity for a double dissolution election arises.

Throwing the switch to election mode with all of those volatile ingredients in play would not seem very appealing.

Some would argue that the Coalition risked throwing away the chance to make lasting policy the whole party room believed important, simply to deliver on a promise that served its political purpose two years earlier.

One the other hand, Tony Abbott will no doubt be acutely aware that his political opponents, fired by a deep animosity at what they regard as his hypocrisy, will be ready to climb all over him at the first chance to say he "lied" about his intentions before the election.

What then might be a graceful compromise that could get through the Parliament and be able to be spun as a repealing of the carbon tax?

One possibility would be, after trying and failing to repeal the carbon pricing regime, to bring forward the conversion of the tax to a cap and trade system, perhaps by six months or a year. Tony Abbott could argue that he has removed the toxic tax. The carbon price per tonne to business is likely to be lower.

The Senate would find it difficult to oppose the legislation and restless voices in the Coalition's own party room, either because they are concerned about Direct Action's efficacy or because they support a market-based approach, would be quietened.

On the other hand, the most powerful and vocal opponents of the tax in the Coalition are against any form of carbon price.

Tony Abbott has shown an ability to create and maintain unity in what was a deeply divided party room which preferred him as leader by just one vote in 2009. Whether he decides to try to massage carbon compromise through his party room or risks everything on the most politically volatile issue of our time will define his leadership style.

David Forman is general manager at issues management firm Communications and Public Relations. He is a political commentator with a focus on policy analysis and predictions. View his full profile here.